Rhoda Meek: Farmers are the ones being left with diddly squat

I, like many – especially in crofting ­areas – do it because it’s something we have always done. It’s in the blood. We see it as our duty to leave the ­hard-won land in good shape for the next ­generation.

There’s a connection with the ground that is almost impossible to describe and even harder to rationalise. But it’s that connection which leaves us up to our knees in mud mid-January year after year.

Animals are a nightmare, nature is worse, you don’t make much money, your knees and hips are gone within a few years of working sheep, the paperwork is ­ridiculous, the penalties for a missing ear tag are ­always in the back of your mind, things die at the drop of a hat, new pests problems and legislation appear almost annually and, supposing there is anyone who wants the thing after you’re gone, they are now going to have to pay tax on your damp, muddy and loss-making legacy after the Chancellor, Rachel Reeves, took a plough and horses through Agricultural Property Relief (APR).

Starting from April 2026, the full 100% inheritance tax relief will be capped at £1 million for combined agricultural and business property. Any value above this threshold will now attract a 20% tax rate, a significant shift from the previous full relief.

While the Government argues this targets only the wealthiest estates, the National Farmers’ Union contends that about 75% of commercial farms will be caught in this new tax net, far exceeding the government’s estimate of 27%. One argument is that this change threatens the viability of family-run farms, potentially forcing sales and undermining the very fabric of our rural communities.

On the flip side, the changes could be seen as a necessary correction to a ­system that has disproportionately favoured the wealthiest landowners. Capping the ­relief at £1m ensures that small and ­medium-sized farms still benefit, while addressing the potential for misuse by ­ultra-rich estates holding agricultural land primarily as a tax shelter.

The ­Government argues this reform is about fairness – why should the wealthiest families avoid ­inheritance tax on vast estates while ­ordinary taxpayers ­shoulder the burden? By redirecting funds to public services or other pressing needs, these changes may strike a better balance ­between ­preserving rural businesses and ensuring the tax system works for ­everyone.

These two arguments have been ­playing out in the press and social media – ­getting ever louder and more polarised. As is ­often the way, the background stories, subtleties and facts get flattened. Leaders of movements emerge. And unfortunately for the farming community, their figureheads have emerged as Jeremy Clarkson and Nigel Farage. Two more polarising figures you could not hope for in a debate with many many shades of grey.

READ MORE: New inheritance tax for farmers may mean bad news for Scotland's land

While Farage is playing to his usual crowd, Clarkson’s efforts are harder to dismiss. Love him or loathe him, he’s used his platform to highlight just how tough it is to turn a profit farming – even with Diddly Squat’s resources.

Over three series of Clarkson’s Farm, Jeremy’s been through the wringer – ­experiencing the harsh realities many of us know all too well. But – he gets well paid to do it, and he originally bought the land to avoid inheritance tax.

He denied it with great bluster on the BBC last week, but was previously quoted saying exactly that in The Times.

Does that mean he doesn’t care about farmers? No, I think he’s got the memo about farming. But I also think he’s an opportunist, and this is quite the ­bandwagon.

With Farage and his shiny ­wellies along for the ride, a 13,000-strong crowd marched on Downing Street last week, flanked by tractors, decrying the ­Government raid that will, they say, wipe out many small farms.

Will small farms be wiped out by this change? Some might. The facts on the ground are that the average net worth of an English farm is £2.2m. If a ­couple get good advice and pass it to a direct ­descendant, there is up to £3m relief ­before tax kicks in.

A single person ­passing it on would qualify for less relief, meaning that the inheritor could end up with a tax bill of £140,000. Inheritance tax on agricultural estates will be ­interest-free over a 10-year period, so there it might mean an annual tax bill of £14,000 for the person taking the farm on.

I’ve seen a lot of left-wing commentary saying how fortunate someone would be to inherit that type of asset and only be paying £14,000 a year for it. After all, there’s no mortgage, right? Yes and no.

Leaving aside the fact the machinery needed to run even modest farms these days runs to hundreds of thousands – ­usually on hire purchase – Defra data shows that last year, 30% of farms made a loss, while a further 25% made less than £25,000. If you are making less than that, and paying a tax bill, you could indeed find yourself in trouble.

READ MORE: Why are the super-rich buying up Scotland?

How many small farms will actually be affected is essentially unknown. The Government doesn’t know how many farms are worth enough to potentially be taxed, while also making very low or no profits.

But even this isn’t the whole story. The fury isn’t just about the complexities of inheritance tax – it’s about the ongoing undermining of the farming sector.

Brexit has left UK farmers competing against imported food produced more cheaply due to fewer regulations.

While the Scottish Government has been focused on trying to emulate the previous Common Agricultural Policy subsidies – matching them, as they begin to introduce their own system – the same can’t be said of Westminster.

Some farms are looking down the ­barrel of losing up to 76% of their ­subsidy. Fuel, fertiliser and feed prices just keep ­climbing and weather patterns are ­changing – sometimes dramatically – with appalling consequences.

And in the midst of all of that, ­farmers are being painted as the villains of the piece when it comes to the environment.

Even in Scottish crofting, where few of us would hit the threshold, and clearing £25,000 per annum would be quite the achievement, we’re being asked to jump through increasing numbers of hoops.

As in England, the expectation is that we will do nature restoration on behalf of the Government, and as always with these things, you are paid in arrears. Farming of any kind involves large upfront ­capital ­investment and very long lead times ­before you get any return on it.

When you add all of that together, it’s amazing that tractors weren’t parked ­outside Downing Street a long time ago.

The farming landscape is pretty bleak at the moment. Why would you pass on such a burden? It’s easy to see how many ­people might see this as a catalyst to ­finally call it quits, sell their land to the highest corporate bidder, and move on.

The anger isn’t about a marginal tax rate – that was just the final straw. For ­generations, farmers have fought to ­survive. Now, those without their own TV shows or tax shelters can see even more clearly that there are no rewards for their service.

Whether they pass their farms on or not, they are getting diddly squat.